Who is paying for pro- and anti-pension campaigns?

Outsiders fund advocates for change; city unions support their opponents

Oct. 27, 2013

Chris Littleton, the campaign manager of Cincinnati for Pension Reform, says it's “not surprising” that unions would be the primary source of funding for those opposing Issue 4. / The Enquirer/Liz Dufour

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Money for the campaign pushing to dramatically change the Cincinnati pension system has primarily come from private 501(c)(4) organizations from within Ohio but outside Cincinnati, while campaigns opposing the measure are funded by city worker unions. Few individual contributors are giving money to either side, an Enquirer review of campaign finance records released Friday shows.

The report shows that the group pushing the change was almost out of money as of Thursday, having spent nearly $215,000 since July. But the report does not include later contributions that could help fund a last-minute ad blitz. Meanwhile, the two main Issue 4 opponents had raised nearly $240,000 in little over two weeks and still have almost half of what they’ve raised on hand.

If passed, Issue 4 would basically freeze and eliminate the city’s existing pension plan and replace it with a 401(k)-style retirement system.

It also contains a provision that some interpret as meaning the city needs to pay off the current system’s $870 million unfunded liability within 10 years.

Some of those 501(c)(4) groups backing the pro-Issue 4 campaign committee Cincinnati for Pension Reform include West Chester-based Ohio Rising as well as Jobs and Progress Fund, which gave $69,000 and $24,000 apiece. The groups, which, like other 501(c)(4)s, do not have to disclose their donors, were the two largest contributors to the campaign committee.

The conservative groups also were among those selected for extra screening by the Internal Revenue Service as part of their tax-exempt application process over the last two years. That extra screening, and how the groups were selected and targeted for such treatment, is at the heart of the ongoing controversy surrounding the IRS. According to agency regulations, such groups can contribute to political causes so long as such “political activity” does not consist of the “majority” of the group’s activities. Those groups do not have to reveal their individual donors, although contributions to such groups are not tax-deductible.

In addition, Jobs and Progress Fund is headquartered at the office of West Chester lawyer David Langdon. The political committee Cincinnati for Pension Reform paid Langdon’s firm Langdon Law LLC nearly $24,000 for legal services. And Ohio Rising is a group that was founded by Chris Littleton, who is now the campaign manager for Cincinnati for Pension Reform and has received nearly $12,000 from the campaign to date.

All told, Cincinnati for Pension Reform raised $231,235 from its creation in July through Oct. 16. During that time, it spent more than $215,000, and had $2,062 on hand as of Thursday, according to the reports. That included nearly $70,000 to pay Arno Petition Consultants out of Carlsbad, Calif., to help collect enough signatures to place Issue 4 on the ballot. In addition, the committee paid for a direct mail campaign as well as online video ads.

The pro-Issue 4 committee received only nine contributions from individuals, totaling $1,235. And none of the five different groups contributing to the campaign committee was located in Cincinnati, although only one, the Liberty Initiative Fund of Woodbridge, Va., was from outside the state. That group contributed $20,000 to Cincinnati for Pension Reform during the reporting period.

“The origin of the money is not the issue here,” Littleton said. “What is at issue is whether or not the broken pension system needs to be fixed. We think it does, and this is the remedy.... And whether or not you actually live in the city, what happens in Cincinnati affects everyone, so everyone should be able to contribute.”

Issue 4’s opponents said that such outside donors “won’t have to live with the consequences of their actions.”

“We figure that 99.7 percent of their money came from outside the city ... and they won’t have to feel the repercussions of higher taxes and reduced services,” said David Little, spokesman for Cincinnati for Pension Responsibility, one of two campaigns founded last month to oppose Issue 4. The other anti-Issue 4 includes Citizens for Responsible and Accountable Government.

Cincinnati for Pension Responsibility is primarily funded by several different branches of the American Federation of State, County, and Municipal Employees, which represents about 1,800 workers for the city of Cincinnati. In just two weeks, the committee raised $207,970 and had more than $115,000 on hand as of Thursday. It received contributions from only two individuals, totaling $750, including a $500 contribution from former acting Cincinnati city manager and current Dayton city manager Tim Riordan.

The other campaign committee (CRAG) was funded solely by the Cincinnati Organized and Dedicated Employees, a union that represents 850 city workers. It raised $30,000 in two weeks and had more than $11,000 on hand as of Thursday.

“This goes beyond a union issue; this is a city issue, and that is why we’re fighting it,” said union president Jeff Harmon. “This measure is going to lead to higher taxes and possible lawsuits for the city and would potentially bankrupt Cincinnati.”

Littleton, of the pro-Issue 4 campaign committee, said it was “not surprising” that the unions would be the primary source of funding for those opposing the measure.

“Since the unions negotiate so hard to protect these things, they are working hard to maintain something that is not sustainable,” he said. ⬛